§3362 Emergency Purchase Authority

Summary

When the President declares a natural gas supply emergency, the President can let interstate pipelines or local gas companies sign contracts to buy emergency gas. The President sets the rules and prices. They can buy from two kinds of sellers: (1) a gas producer that is not affiliated with the buyer, as long as the gas is not from the Outer Continental Shelf and the sale was not already covered by a Natural Gas Act certificate at the time the contract is signed; or (2) an intrastate pipeline, a local gas company, or another person (but not an interstate pipeline or a producer). Any emergency contract can last no more than 4 months, but the President can allow renewals after it ends. The President can also order pipelines to move the gas or build and run needed facilities. The buyer must pay the costs, and pipelines are not forced to carry more gas than they have room for. The federal commission must require full records of purchases, volumes, rates, and charges. If the gas comes from an intrastate pipeline that was under court supervision on January 1, 1977, the court must approve the sale.